The recent market turbulence, largely due to global uncertainties, has been a roller-coaster ride for investors. Akshay Gupta, Managing Director & CEO of Prime Research & Advisory, points out that despite the ups and downs, India’s economic growth and corporate performance remain strong.
Here are some key insights from the interview:
Current Market Turbulence:
According to Gupta, the market volatility is temporary and driven by uncertainty. He believes that the market will eventually realign to focus on country growth and corporate performance, which have not significantly changed in India despite the recent corrections.
Market Stability:
While there may be further price corrections of 5-10%, Gupta anticipates a prolonged period of time correction as investors wait to understand the "new world order."
IndusInd Bank Saga Impact:
Gupta views the issues surrounding IndusInd Bank as individual cases of misgovernance that will be contained by regulators. He notes that the promoters’ support for the bank and its reasonable capital adequacy and liquidity numbers provide some reassurance.
Undervalued Sectors:
Sectors such as Defence, PSUs, Infrastructure, and Manufacturing, which experienced significant surges in the past, have corrected below their fundamental valuations. Gupta expects these sectors to bounce back strongly once the market stabilizes.
IPO Market Outlook:
Gupta predicts a subdued IPO market compared to the past two years. While big companies may still attract investor interest, smaller companies could struggle to generate the same level of enthusiasm due to a waning "herd mentality."
Fundraising Plans:
Prime Research & Advisory does not have any fundraising plans for the current financial year.
In conclusion, despite the uncertainties in the market, Gupta remains confident in India’s underlying economic strength and corporate performance. He believes that the market will eventually stabilize and realign with these fundamentals.
